The Not-Working Class

The Not-Working Class

In a capitalist country like ours, hard work is supposed to be rewarded and slothfulness is considered one of the seven deadly sins.

So what to make of the “quiet catastrophe,” which George Will describes as follows: “After 88 consecutive months of the economic expansion that began in June 2009, a smaller percentage of American males in the prime working years (ages 25 to 54) are working than were working near the end of the Great Depression in 1940, when the unemployment rate was above 14%. If the labor-force participation rate were as high today as it was as recently as 2000, nearly 10 million more Americans would have jobs.”

If even half of those 10 million men were working, the economy would be growing at a faster rate, productivity would increase and consumer spending would be higher. So why are they out of work when the economy is allegedly booming and the unemployment rate has fallen to just 4.8%?

Of the 23 affluent countries in the Organization for Economic Co-operation and Development, the United States ranks 22nd, ahead of only last-place Italy, in 25-to-54 year-old male labor-force participation.

Two plausible explanations exist—and neither one is complimentary to the economic policies of former President Obama or his predecessors.

Eerie and Radical

In his new book, Men Without Work: America’s Invisible Crisis, Nicholas Eberstadt concludes that America’s government-funded and government-mandated programs to help the unemployed and those with low income have created a “flight from work.”

Only 84.3% of men aged 25 to 54 were working in 2015, compared to 94.1% in 1948, which is a decrease of more than 11%. The numbers are even more frightening for men 20 and older—only 68.2% worked in 2015, compared to 85.8% in 1948, which is a 25.8% drop. This number is astounding, even when you consider that people are living longer and presumably spending more years in retirement.

“This ‘eerie and radical transformation’—men creating an ‘alternative lifestyle to the age-old male quest for a paying job’—is largely voluntary,” according to Will. “Men who have chosen to not seek work are two-and-a-half times more numerous than men who government statistics count as unemployed because they are seeking jobs.”

Conversely, economist Jeff Madrick, writing in The New York Review of Books claims a different explanation, suggesting that “there are too few jobs for these men.” However, Wills notes that, “Only about 15% of men ages 25 to 54 who worked not at all in 2014 said they were unemployed because they could not find work.”

Madrick also points out, as we have in the past, that the official government unemployment rate is about twice the official rate “if we take into account those who stopped looking for work or those who can only find part-time work.”

Some may be unemployed because they lack the skills that are increasingly demanded in today’s workplace. However, in 1965 high-school dropouts had a higher likelihood of being in the workforce than today’s 25-to-54-year-old males, who on average have much more education than the typical male of 1965.

Some may be having difficulty finding work, but others appear to be finding ways to earn income without working.

As we’ve previously noted, “the percentage of Americans receiving financial support through a federally-funded ‘means-tested program’ is 35.4%, but when you add pensions, unemployment, Social Security and Medicare, the percentage of Americans who rely on the government for part or all of their subsistence is 49.5%. In other words, half of the country is paying to support the other half.”

Consider, too, the increase in the number of disabled Americans that has taken place since 1960. Eberstadt noted that in 1960 there was one worker certified as being disabled for every 134 workers who had no disabilities. By 2010, there was one certified disabled worker for every 16 non-disabled workers. The Occupational Safety and Health Administration (OSHA) was created in 1970, so today’s workplace is much safer than the workplace of 1960. So why have disabilities increased by 837%?

“Between January 2010 and December 2011,” Wills wrote, “while the economy produced 1.73 million non-farm jobs, almost half as many workers became disability recipients.”

When people are receiving disability payments, the rest of us have to pay more to support them. When they are not working and paying income taxes, it means the rest of us have to pay more in taxes to make up the difference.

So is the “quiet catastrophe” a result of social changes or economic changes? Is it demographic or cultural? What role has government played in causing it—and what role can it play in reversing the trend?

Whatever the causes, millions of able-bodied, working-age men are staying at home and are being supported by their spouses, their parents and the government (i.e., taxpayers). The phenomenon of a growing not-working class and a shrinking working class is likely related to a recent report that 66.6% of Americans aged 15 to 29 are living with their parents.

Both the increase in adults living at home and adult males dropping out of the workforce are sad commentaries on society today, but they’re also a drain on the economy that does not bode well for the future.